scholarly journals The Updated Okun Method for Estimation of Potential Output with Broad Measures of Labor Underutilization: An Empirical Analysis

2021 ◽  
Author(s):  
Claudia Fontanari ◽  
◽  
Antonella Palumbo ◽  
Chiara Salvatori ◽  
◽  
...  
Keyword(s):  
Full Employment ◽  
Original Method ◽  
Labor Input ◽  
Empirical Measures ◽  
Standard Methods ◽  
Potential Output ◽  
Output Loss ◽  
Official Rate ◽  
Output Gaps ◽  
Labor Underutilization

This paper extends to different indicators of labor underutilization the Updated Okun Method (UOM) for estimation of potential output proposed in Fontanari et al (2020), which, from a demand-led growth perspective, regards potential output as an empirical approximation to full-employment output, as in A.M.Okun’s (1962) original method. Based on the apparent incapability of the official rate of unemployment to fully account for labor underutilization, in this paper we offer estimates of Okun’s law both with broad unemployment indicators and with an indicator of ‘standardized hours worked’ which we propose as a novel measure of the labor input. The paper reflects on the possible different empirical measures of full employment. The various measures of potential output that we extract from our analysis show greater output gaps than those produced by standard methods, thus highlighting a systematic tendency of the latter to underestimate potential output. Output gaps that underestimate the size of the output loss or that tend to close too soon during recovery, may produce a bias towards untimely restriction.

Can Stimulus without Debt Combat Secular Stagnation?

2018 ◽  
Author(s):  
Laurence Seidman
Keyword(s):  
Slow Growth ◽  
Full Employment ◽  
Aggregate Demand ◽  
Secular Stagnation ◽  
Potential Output ◽  
Goods And Services ◽  
Actual Output ◽  
Debt Policy

Two possible sources of “secular stagnation” must be distinguished. The first source is chronically insufficient aggregate demand for goods and services; insufficient demand is demand that is less than the potential output of the economy. The second source is slow growth in the potential output of the economy. If secular stagnation occurs due to chronically insufficient demand, a stimulus-without-debt policy that is applied as long as demand would otherwise be insufficient can keep actual output equal to potential output and therefore can achieve and maintain full employment (because potential output is defined as the output that would be produced in a given year if labor is fully employed in that year); every year, the level of output and employment would be equal to potential output instead of being below potential output.

Results of application of a new method for the treatment of hallux valgus of the first toe

2016 ◽  
Vol 94 (6) ◽  
pp. 458-462
Author(s):  
L. K. Brizhan’ ◽  
A. V. Boichenko ◽  
D. V. Davydov ◽  
L. N. Solomin ◽  
A. A. Kerimov ◽  
...  
Keyword(s):  
Comparative Analysis ◽  
Hallux Valgus ◽  
Original Method ◽  
Surgical Correction ◽  
Aofas Score ◽  
Intermetatarsal Angle ◽  
Standard Methods ◽  
X Ray ◽  
Significant Difference ◽  
Better Than

Background. The aim of the present article was to report our experience with the treatment ofpatients with hallux valgus and to perform comparative analysis of the results of the newly proposed and standard methods for its surgical correction. Methods. The data on 70patients (101 feet) with hallux valgus that were operated on between 2011 and 2015 in St. Petersburg Hospital No 2 using the new and standard methods were analysed. The functional assessment (AOFAS score) and X-ray examination were performed preoperatively, 3 and 12 months after the procedure. Comparative analysis between patients undergoing surgical correction by the new and standard methods has been undertaken. Results. We did not find any significant difference between the two groups in mean AOFAS score 12 months after surgery. Nevertheless, the function score of the patients treated by the newly proposed method (79.4±6.5 in 3 months) was significantly better than in those given the standard treatment (72.2±7.6 in 3 months). Mean intermetatarsal angle 12 months after surgery by standard and new methods was 9,7±0,7° and 8,6±0,7° (p<0.05), mean metatarsophalangeal angle 13,6±0,9° and 13,0±1,1° (p<0,05) respectively. Conclusion. According to the data obtained, the original method of hallux valgus surgical correction allows to improve its functional and x-ray results.

scholarly journals Estimating the Potential Output and Output Gap of Ghana

2019 ◽  
Vol 6 (3) ◽  
pp. 58
Author(s):  
Joseph Atta-Mensah ◽  
Sawuya Nakijoba
Keyword(s):  
Economic Activity ◽  
Time Trends ◽  
Linear Time ◽  
Output Gap ◽  
Annual Data ◽  
Conceptual Tool ◽  
Potential Output ◽  
Economic Information ◽  
Hp Filter ◽  
Output Gaps

This paper focuses on the estimation of the potential output of Ghana. Potential output or its derivative the output gap are not observable. However, “potential output” is a powerful conceptual tool that guides analysts and policymakers in gauging whether the current observed economic activity is sustainable and how much of it is greater than or less than potential. Based on Ghanaian GDP annual data from 1960 – 2017, the paper estimates potential output and output gaps using the following methodology: linear time trends, Hodrick-Prescott (HP) filter trends, multivariate HP filter trends, and a production function model. The results show that estimates of the potential output and output gaps are model-dependent as estimates vary from one methodology to the other. The paper recommends that policymakers should not mechanically choose a model to estimate output gap. For the avoidance of costly policy mistakes, the choice of the model should be complemented with sound judgement based on a set of pertinent economic information.

The U.S. Unemployment Rate

2020 ◽  
pp. 137-150
Author(s):  
Frank Stricker
Keyword(s):  
Unemployment Rate ◽  
Government Policy ◽  
Full Employment ◽  
Census Bureau ◽  
Works Progress Administration ◽  
Government Officials ◽  
Discouraged Workers ◽  
Official Rate ◽  
Bureau Of Labor Statistics ◽  
The U.S

Creating a scientific survey of unemployment in the 1930s and 1940s was an advance for people’s understanding of unemployment and for rational government policy. Many government officials, including Secretary of Labor Frances Perkins and agencies including the Census Bureau, the Works Progress Administration, and the Bureau of Labor Statistics (BLS), deserve credit for the achievement. However, today’s BLS unemployment rate omits too many people, and the low count weakens support for job-creation programs. This chapter offers a short history and a critique. It explains and evaluates the official rate, discusses hidden unemployment, including discouraged workers and other labor-force dropouts, evaluates alternative unemployment rates, including the BLS’s U-6 and the National Jobs for All Coalition’s rate, and examines the idea of full employment.

scholarly journals Potential Output in Theory and Practice: A Revision and Update of Okun’s Original Method

2019 ◽  
Author(s):  
Claudia Fontanari ◽  
Antonella Palumbo ◽  
Chiara Salvatori
Keyword(s):  
Original Method ◽  
Theory And Practice ◽  
Potential Output

GDP Growth, Potential Output, and Output Gaps in Mexico

2005 ◽  
Author(s):  
Ebrima Faal
Keyword(s):  
Growth Potential ◽  
Gdp Growth ◽  
Potential Output ◽  
Output Gaps

Gdp Growth, Potential Output, and Output Gaps in Mexico

2005 ◽  
Vol 05 (93) ◽  
pp. 1 ◽  
Author(s):  
Ebrima Faal ◽  
Keyword(s):  
Growth Potential ◽  
Gdp Growth ◽  
Potential Output ◽  
Output Gaps

2015 Spillover Report

Policy Papers ◽  
2015 ◽  
Vol 2015 (43) ◽  
Author(s):  
Keyword(s):  
Monetary Policy ◽  
Aggregate Demand ◽  
Output Growth ◽  
Structural Reforms ◽  
Demand And Supply ◽  
Potential Output ◽  
Advanced Economies ◽  
Potential Output Growth ◽  
Output Gaps ◽  
The Impact

Many countries around the globe, particularly the systemic advanced economies, face the challenge of closing output gaps and raising potential output growth. Addressing these challenges requires a package of macroeconomic, financial and structural policies that will boost both aggregate demand and aggregate supply, while closing the shortfall between demand and supply. Each element of this package is important and one cannot substitute for the other: easy monetary policy will not raise potential output just as structural reforms will not close the output gap. This report studies the impact on emerging markets and nonsystemic advanced economies from monetary policy actions in systemic advanced economies, with a look also at knock-on effects from the decline in world oil prices.

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